Beauty, Mercy, Justice

Productivity Without Pay

The truth is that American workers are the most productive in the world. US worker productivity increased 80 percent from 1973 to 2011, eight times as much as hourly worker compensation. The average worker is responsible for $63,885 of wealth per year. Yet more than a third of households make less than $30,000 a year. We have the highest percentage of low wage workers in the world–almost 25 percent. The people who bring us our food–farm workers, food processers, restaurant workers and grocery workers–usually make poverty wages. The people who we trust to take care of our children, parents, grandparents and sometimes ourselves when we are sick or disabled; people who work in nursing homes and hospitals; nannies, childcare and Head Start workers–all of these crucial workers are all too often making poverty wages. Fifty percent of personal care workers live in poverty. Most of them are women, and 40 percent of female-headed households live in poverty.

Although we have lost millions of jobs to automation, the computer age, and to countries overseas, most of the remaining low-wage jobs in the US cannot be sent to another country and will not be replaced by a machine. The people doing these jobs have families to support and often have to work two or three jobs to make ends meet. Most do not have health insurance, sick days or pensions. Few are represented by unions and so they do not dare to challenge their employers when they are treated unfairly or even have wages and tips stolen from them.

There are countless millions more who work in sales and services for companies that have low wage and minimal benefit policies. Most of these companies are highly profitable and say they cannot afford to pay workers more but they pay their CEOs and other high level employees outrageously high salaries even when business goes down.

Raising the minimum wage to ten dollars an hour [at least! -ed.] and indexing it to inflation would be a good first step to repair our economy and help millions of families out of poverty. Enforcement of wage laws and prosecution of wage theft would add billions of hard-earned dollars to the incomes of the lowest earning families. Allowing workers to join or form unions without harassment or unfair dismissal has proven to enrich the lowest paid workers without bankrupting their companies.

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We’ve done this in Oregon (or close) with very little ill effect. Next step, in the works and already city ordinance in Portland, is mandatory sick time, which will even affect me as a highly paid consultant (I lost $400 so far this week due to illness, and I’m currently working sick, just two cities over). Can’t wait for this to become state law. Our minimum wage is $8.95 and is inflation linked, goes up a nickle or a dime every year.

Now of course, this will NEVER be enough to get people out of poverty. Inflation is created by the spread of the lowest to highest wage; it is driven to always be more than the lowest wage people can afford, and is limited on the upper end only by what the rich can afford, so in a country where you have CEOs that earn 400-800x the lowest paid workers, all raising the minimum wage will do is keep the poverty tolerable. You need to get back to almost a 10x spread for the limiting to have any effect at all. Which is why I’m not only for a living wage law (where a man’s wages are tied more to his responsibilities than his work) but also a maximum wage law (where taxes cap maximum earnable income at something beyond what one person can spend in a lifetime, but still small enough to have the spread between living wage and maximum wage be as small as is reasonable to still provide incentive).

I don’t think it is unreasonable for a business owner to net $500,000/year- if he’s paying his lowest wage worker $50,000/year. It’s the tail ends of the bell curve that concern me, not the middle.